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Volkswagen plots a comeback behind a seven-seat SUV savior

January 13, 2014

For Volkswagen, 2013 was a year to forget in the United States.

Total sales in North America were down some 7 percent versus calendar year 2012 and, if you know the VW Group as we do, this does not one bit sit well with the German home office in Wolfsburg. VW anticipated a rationalization phase this year due to certain products going off line and other key models – Golf VII and its GTI version among them – only coming available in mid-2014.

But Wolfsburg is clearly somewhat stumped by the length of the slow-up in sales. With VW's leaders sticking to their goal of selling 1 million Volkswagen and Audis annually by 2018, last year the group managed just 559,000. In other words, to meet its target, Volkswagen would need to add sales equal to Subaru's within four years.

During a gathering here at the Detroit auto show, Volkswagen Group CEO Martin Winterkorn revealed the company would finally build a long-awaited seven-passenger SUV, to compete with the heart of the U.S. market as a 2016 model year vehicle. Based off the CrossBlue concept unveiled a year ago in Detroit, the new SUV will be not quite as premium as either the VW Touareg or Audi Q7, but will offer more than the current VW Tiguan and Audi Q5.

The more important unresolved question is exactly where the model will be built. Winterkorn said that verdict shall be passed down within the next three months; the new Chattanooga, Tenn., factory remains the favorite in most people’s minds, but there is a clear chance that the project could be handed to the VW main plant in Puebla, Mexico.

One model won't make the goal on its own. Speaking with Volkswagen North America president and CEO Michael Horn, and board member and head of Group Powertrain Development, Heinz-Jakob Neusser. In North America in both companies will offer several MQB architecture-based EV products and full plug-ins, the e-Golf being a key offering here.

Secondly, cleaner “greenhouse gas” emitting products with internal combustion engines in North America will be an equal priority. This path incudes the two major focuses of clean diesel as well as a severe downsizing trend in gas –powered engines. Only once these technology trends have been properly established will the swifter expansion of the product lineup for North America be let go full steam around 2016. We'll see if it's enough well before then.